Roth Capital Reiterates Buy On NeoGenomics, Sees 27% Upside For The Stock


In a research report issued yesterday, Roth Capital analyst Debjit Chattopadhyay reiterated a Buy rating on NeoGenomics Inc. (NASDAQ:NEO) with a $7 price target, which represents a 27% upside from where the stock is currently trading.

Chattopadhyay noted, “For 2014 and 2015 we expect core business test volume growth of ~25% and ~18%, respectively. Note that our assumption excludes contributions from Path Labs, non-invasive prostate cancer test, and Covance (CVD-NC). We believe that NEO’s comprehensive product menu and the CVD partnership have been instrumental in some key business wins, which might make our estimates appear conservative.”

Chattopadhyay continued, “We believe NEO has been successfully leveraging its relationship with CVD to deliver key wins in the clinical trial business segment. Revenue from this segment should positively impact NEO’s topline during 4Q14 and our estimate of $22.7M ($83.7M for FY14) may prove to be conservative. With a comprehensive menu of molecular tests and Next-Gen-Sequencing, we believe NEO is being viewed as the one-stop-shop for cancer diagnostics. NEO’s brand positioning has allowed the company to add key sales reps and open up new territories at the expense of competitors, which translated into robust volume growth (40% YoY during 2Q14).”

According to TipRanks.com, which measures analysts’ and bloggers’ success rate based on how their calls perform, analyst Debjit Chattopadhyay has a total average return of 4.9% and a 42.3% success rate. Chattopadhyay has a 51.3% average return when recommending NEO, and is ranked #1383 out of 3277 analysts.

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